Netflix (NFLX) 2020 Q4 Earnings Review

Netflix Inc. (NASDAQ:NFLX), founded in 1997, is a video streaming giant based in Scotts Valley, California. With the aggressive international expansion in recent years, it has become the world’s biggest subscription streaming service. The company went public in May 2002 by selling 5.5 million shares at $15. It has come a long way since then, overcoming many challenges in its decades-long journey.

The company recently revealed that its paying subscribers surpassed 200 million at the end of December 2020. It is a massive achievement since NFLX just had around 12 million subscribers at the beginning of 2010. Much of its growth during the past year was attributed to the lockdown restrictions imposed in different parts of the world to contain the spread of the Covid-19. People stuck at home increasingly turned to online entertainment services such as Netflix, which greatly benefitted from the trend due to its presence in more than 190 countries.

The pandemic helped the company to add a record 37 million paid subscribers last year, bringing the total to over 200 million. Meanwhile, it is building a diverse portfolio of original TV shows and movies to further grow its customer base. Overall, NFLX stock value increased more than 63 percent in 2020.

NFLX shares once again skyrocketed 16.85 percent on Wednesday after the company announced solid fourth-quarter results. The massive subscriber growth and recent price hike helped the company generate revenue of $6.6 billion in the latest quarter, translating to a surge of 24 percent on a year-over-year basis. Revenue for the full year jumped to $25 billion.

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The company stated in a letter to investors, “We believe we no longer have a need to raise external financing for our day-to-day operations.”